Acting to stop harm: the FCA and Appointed Representatives
The recent case of Pnaiser v NHS England and Coventry City Council highlights the dangers for employers of deviating from agreed written references and giving additional, but contradictory, verbal comments on a former employee. The Employment Appeal Tribunal’s (“EAT”) decision also makes it clear that potential new employers should be wary of revoking any offer of employment if there is a suggestion that a verbal reference may be influenced by discrimination.
Section 15(1) of the Equality Act 2010 (the “Act”) prevents employers from treating employees (including former and potential employees) unfavourably because of something arising in consequence of a disability, unless they can show that the treatment is a proportionate means of achieving a legitimate aim. Any employee purporting to rely on this provision must first demonstrate that they have a prima facie case, but once they have done so it will be for their employer to show, on the balance of probabilities, that no discrimination occurred.
Ms Pnaiser, who was disabled for the purposes of the Act, was employed by Coventry City Council (“CCC”) and took a number of long absences from work on account of her disability and the treatment she was receiving in relation to it. She was made redundant and entered into a settlement agreement with CCC which included an agreed, written reference. She was then offered and accepted a job with NHS England (“NHS”), subject to the provision of satisfactory references. NHS sought a reference for Ms Pnaiser by sending to CCC their standard template, but they found the wording of the agreed reference, which they received in return, to be insufficient for their purposes. As such, NHS’ representative took CCC up on their offer for further clarification of the agreed wording.
The precise tenor of that conversation was disputed, but it was admitted that CCC’s representative did know that Ms Pnaiser had been absent on account of her disability and that she did mention to NHS that Ms Pnaiser had significant absences during her employment. The EAT also found that there were facts which entitled it to infer that the reason CCC’s representative had commented, during that conversation, that Ms Pnaiser would be unsuitable for the new role was at least partly because of her disability-related absences.
The EAT overturned the first instance finding that there had been no discrimination on the basis that the Employment Tribunal applied a test which required Ms Pnaiser “to show that the only inference that could be drawn was a discriminatory one before it could conclude that the burden shifted”. This was wrong and Ms Pnasier had established a prima facie case which was sufficient to shift the burden to CCC and NHS. As there was sufficient evidence to conclude that at least part of the reason for the negative reference was her absences, and CCC ran no justification defence, the EAT held that CCC had discriminated against Ms Pnaiser.
The EAT also found that NHS had constructive knowledge of Ms Pnaiser’s disability; their representative received the negative reference while knowing about the fact of her absences and their medical context. Although he did not know, and did not ask, why the negative reference was given, the “only possible conclusion available on the facts” was that it was at least partly as a consequence of her absences. Therefore, when NHS withdrew the job offer, they too unlawfully discriminated against Ms Pnaiser.
The lessons to be drawn from CCC’s mistakes are clear: employers should stick closely to agreed references; verbal references should be treated with caution (being in mind the shifting burden of proof and the evidential difficulties this carries); and, avoid temptation by giving some thought to what form of reference a potential employer may be asking for. As for the NHS, it is clear that an employer cannot shut its eyes where there are facts to suggest a negative reference is affected by discrimination. On the contrary, if they had asked for more information it may have helped them develop a justification defence in the event that the negative reference was such that they felt there was no alternative but to withdraw the offer.
If you need advice in relation to employee references, the law governing recruitment, redundancy and other methods of termination, please contact a member of the employment team.
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